Microsoft boss Nadella referred to as for wage cuts after safety incidents

Microsoft CEO Satya Nadella speaks at an event at the company's campus in Redmond, Washington, on May 20, 2024.

Chona Kasinger | Bloomberg | Getty Images

Microsoft gave CEO Satya Nadella a fiscal 2024 pay raise of more than $30 million. However, without a series of cyberattacks, his total package would have been $5.5 million higher.

Nadella received $79.1 million for the fiscal year that ended June 30, up from $48.5 million the previous year, according to a proxy filing Thursday. The majority of his salary comes from stocks. The board's compensation committee said Nadella asked that the cash incentive portion reflect safety considerations.

The requested cut came after the U.S. Department of Homeland Security released a report in April that followed an independent review of China's breach of the email accounts of U.S. government officials. Microsoft disclosed this incident in July 2023.

In January this year, Microsoft said that Russian intelligence had accessed the email accounts of some of the company's top managers.

Microsoft said it would overhaul its practices to address the deficiencies highlighted in the government report. It states: “Customers would benefit from the CEO and board of directors focusing directly on the company’s safety culture.”

Nadella responded by telling employees in a May memo that Microsoft would prioritize security above all else. In June, Microsoft announced that it would consider employees' cybersecurity efforts when determining their compensation.

The cash incentive portion of Nadella's salary primarily takes into account the software maker's performance against revenue and operating income targets. It was originally supposed to be $10.66 million, but the full board approved a cash incentive of $5.2 million instead.

“Mr. Nadella agreed that the company's performance was extremely strong, but in light of his personal commitment to safety and his role as CEO, he asked the board to consider deviating from the established performance metrics and reducing his cash incentive to his “The focus and speed required by the changes demonstrated by today’s cybersecurity threat landscape were necessary,” the committee wrote.

Microsoft's security business generated more than $20 billion in revenue in 2022, more than the combined revenue of many security companies.

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